Should I sell all my stocks? My contacts are selling? Is crash imminent? I don't want to be last out? Help!

Question

My entire family is selling this week. My co-workers are transferring their 401K portfolio to money market and guarnteed investment funds. I ride the train down town in Chicago, and the traders that I ride with all told me they are getting out this week. They said they are going to selloff their personal stocks over the course of the next few weeks? I'm worried about retirement. Should I sell everything before it is too late?

Thanks

I am 39.

I have three indivdual stocks. Anheiser Bush, Schering Plough, and Walgreens.

Then I have a mixed 401K
S & P 500, Emerg. growth,
small stock, mid cap
then a Rowe Spectrum

I have made great returns, but I was told that I could lose 25-35 % in one day if it crashes? :-(

Answer 1

SELL! SELL! SELL! SELL!!!!!!! GET OUT BEFORE YOU HAVE TO DECLARE BANKRUPTCY!


I am losing 12% this month. I am not panicking though because I still have great picks. This is just a buying opportunity. The market will recover as we have had a little more than 9,523,879,0179,236 freak out moments and the market always recovers and gets better!!

If your holdings are not good companies, then get out. If they are good picks, then keep them and hold on. It is a bumpy ride but things will get better.

I can't remember who said this but he was a good investor and he said, "I buy when everyone is selling and sell when they are buying"

The traders are recommending selling? Those guys aren't anything but glorified salesmen! The key word is Traders and not Investors! Those jackasses don't know ****!

Answer 2

No one knows. If we did know, we would leave before it happened. If crashes could be predicted then we would schedule them.

As a professional investor, your problem is a strong lack of knowledge. I have two suggestions, first, since you have a non-diverse portfolio and do not know how to adjust that, visit an Edward Jones broker. They do a respectable job of keeping people out of trouble and helping them with their future.

Second, a crash is only serious if the market does not recover when you need it. That happens about half the time, the other half of the the time it goes way up later. So if you do not sell before a crash, do not sell, it is too late then.

Finally, buy a copy of "The Intelligent Investor," by Benjamin Graham. It was last published in 1972 but it is still to be found in virtually every Barnes and Noble and Borders bookstore and it will still be in publication in 2072.

You need to get help locally first. Stay off Yahoo Answers for questions like this. No one here has a clue what to do, in my experience.

Second, you need to acquire knowledge. If you do not know what to do, you are at the mercy of those who do, and they may not have your self interest at heart. Presume they do not. Start with the book I suggested and then go on from there.

Answer 3

How old are you? How soon are you to retirement?

First, don't panic and don't trade solely on emotion. Can you wait it out? Do you have between 5 and 10 years? The market will rebound. It depends on the stocks you have. Are you diversified?

Don't panic. What do you know about these people?
One of the guys that my husband works with believes that if you put money in the stock market, you will lose. He's kind of an idiot with that attitude.

If you are retiring within the next 3 years then yes, it might be advisable to transfer your funds to more conservative investments but you should have been doing that long before now.

Be careful of greed.

Answer 4

No, don't sell a thing. You have some strong stocks there and the market is not going to crash. You may readjust how you spend the money you are putting into your portfolio is invested, but I wouldn't sell anything. You are young, these stocks will rebound.

This is a market correction. These happen historically and usually are around a 10% drop - it'll rebound in about 2 years and see new highs.

Answer 5

Depends on what you have, if your invested mostly into staple companies then it wouldn't really be that big of a deal, everybody's going to need the basic necesities. They'll probably take a hit like everything else and drop but staples will bounce right back up, can't go on too long without food and water.... Basically the market is really shaky. Every bull run has to have a bear run. So far it looks like we're going back into a depression and if that happens the sky's going to be falling. We're had about a 7 year bull so it's only logically to have a bear run pretty soon. It's how the market stays in balance. Whats goes up must come down. If I were you, I'll be looking at that interest rates very closely. If they raise it, you know it's going to be troulbe for all of us.....

Answer 6

Traders now have the ability to sell short without an uptick, which has really upped the volatility...makes it hard for the little guy to stay in the market. You are falling prey to emotion, because your default plan is "buy and hold". I don't think that strategy works for those close to retirement.

I have developed many strategies with Cool Trade that are day trade only, how can anyone sleep at night when the market can open up/down 1-2%???

There are several retired guys running simple Cool Trade strategies that net 10-25% a year without very much risk.

Answer 7

You will go broke guessing market timing. I like to sector invest. I start off with a balanced approach and switch a percentage to the sector I think will do best. Right now i am heavy on gold ,silver, uranium. These were all bought over a year ago in respponse to what I thought would happen now. If you think your stocks are on the way down and you don't unnderstand what will happen next, the best is to go to a percentage of cash.

Answer 8

No panic! My approach is "don't worry about it!" All the news that you hear about is news that you have no control of. You can't control oil prices, you can't control the credit crunch, and you can't control the whacky dollar. MHO is just hang on, and not to worry about it. Warren Buffet didn't panic when the market crashed in 1987, didn't sell a thing.

Although you may feel a bit stressed, try not to focus on it. You still have a long ways before you retire, you'll be okay!

Answer 9

don't be a sucker like everyone else, if everyone else jumped off a bridge would you? hold the stocks you own, i am acutally buying more at these great prices. the market is just correcting itself after the boost from sept-oct. no need to panic like the rest of the sheep.

Answer 10

People who panic and sell in a downturn almost always come out worse than long term investors who stay the course.